New orders give boost to UAE non-oil industriesStaff writer ▼ | December 9, 2012
Average prices set by companies decreased for the second time in the past four months, shows HSBC United Arab Emirates PMI, a composite indicator providing a single-figure snapshot of the performance of the non-oil private sector. At 53.7, almost unchanged from 53.8 in October, the PMI was above the series average of 52.7, and indicated a solid improvement overall.
November data signalled a new increase in output at non-oil producing firms in the UAE and the expansion was mainly driven by a higher number of projects. The volume of incoming new business rose again in November and almost 30 percent of respondents indicated a higher number of new orders and linked this to improved economic and market conditions.
"Given the weak global backdrop, this is another strong reading that puts the UAE non-oil economy firmly in expansionary territory. The strong new orders and new export readings are particularly encouraging and point to an economy not only showing growth but well placed to maintain momentum. Despite the sustained pick up in activity, the PMI shows the economy operating well within capacity; as a result, the upward pressures on prices and wages remains moderate," said Simon Williams, Chief Economist for Middle East and North Africa at HSBC.
The level of new export orders continued to rise and the rate of growth remained strong as more than 20% of respondents indicated higher export orders. The level of outstanding business decreased: projects could be delivered on time and companies reported less outstanding business than in the previous month. Employment levels rose at non-oil producing firms in the UAE, PMI shows. The rate of job creation was, however, the lowest in eight months. Average salaries continued to increase in November.
Mainly driven by increased market competition, companies had to lower their average charges but overall input prices increased further in November. ■